The psalmist realized that if God gave people what they deserve, no one would be able to survive. To mark iniquities means to keep a record of them and hold the sinner accountable for each one. Fortunately God forgives. He does not "keep track" of every sin and exact punishment for it. The psalmist was speaking of how God deals with His redeemed people. The consequence of God forgiving should be that His forgiven people fear Him. Fearing God, a term that in the Old Testament virtually means trusting God, shows itself in obedience and worship. [source][source][source]
"If you take seriously the guilt of sin, you will take seriously the grace of forgiveness." [1][source]